largest trading partner in the European Union. There exists significant
potential for India and UK to further strengthen their economic ties by
effectively leveraging the advantages on offer.
synthesises the insights gained from a study of select UK based
companies, which have an established presence in India. The study,
commissioned by the India Brand Equity Foundation (IBEF) and carried out
by KPMG, is based on information gathered from both primary interviews
and secondary research.
effectively capture the experiences of UK companies in India,
highlighting its key advantages as a market and how these can be
leveraged to profit
UK’s largest and the world’s fifth
largest insurance Group, Aviva is one of the leading providers of life
and pensions products to Europe and has substantial businesses elsewhere
around the world. With a history dating back to 1696, Aviva has a 35
million-customer base worldwide. It has more than US$ 485.4 billion of
assets under management.
In India, Aviva has a long history
dating back to 1834. At the time of nationalisation it was the largest
foreign insurer in India in terms of the compensation paid by the
Government of India. Aviva was also the first foreign insurance company
in India to set up its representative office in 1995. With a strong
sales force of over 16,000 Financial Planning Advisers (FPAs), Aviva has
initiated an innovative and differentiated sales approach to the
business. Through the ‘Financial Health Check’ (FHC) Aviva’s sales force
has been able to establish its credibility in the market. The FHC is a
free service administered by the FPAs for a need-based analysis of the
customer’s long-term savings and insurance needs. Depending on the life
stage and earnings of the customer, the FHC assesses and recommends the
right insurance product for them.
Partners
Open
to picking up equity stakes in Indian banks for cementing its
bancassurance arrangements, Aviva India is a 74:26 per cent joint
venture between the Dabur group and Aviva Life Plc of the UK. In January
2007, Aviva also tied up with IndusInd Bank, one of the leading
new-generation private-sector banks in India. Now, Aviva has extended
its leadership position in the Bancassurance channel with 30 tie-ups,
the largest number of Bank partnerships by any private insurer in India,
and increased its presence to 497 locations in the country.
Currently about 70 per cent of Aviva’s premium contributions came
through bancassurance channels. Aviva was beefing up its direct reach
and increased the number of offices to 197 up from 93 in 2006, and
raising its direct sales force to 31,000 from the current level of
14,000, with a view to sustain its growth momentum.
Products
When Aviva entered the market, most companies were offering traditional
life products. Aviva started by offering the more modern Unit Linked
and Unitised With Profit products to the customers, creating a unique
differentiation. Aviva’s products have been designed in a manner to
provide customers flexibility, transparency and value for money. It has
been among the first companies to introduce the more modern Unit Linked
products in the market. Its products include: whole life (LifeLong),
endowment (LifeSaver, EasyLife Plus), child policy (Young Achiever)
single premium (LifeBond and LifeBond Plus), Pension (PensionPlus), Term
(LifeShield), fixed term protection plan (Freedom LifePlan) and a tax
efficient investment plan with limited premium payment term (LifeBond5).
Aviva products are modern and contemporary unitised products that offer
unique customer benefits like flexibility to choose cover levels,
indexation and partial withdrawals.
Aviva pioneered the concept
of Bancassurance in India, and has leveraged its global expertise in
Bancassurance successfully in India. Currently, Aviva has Bancassurance
tie-ups with ABN Amro Bank, American Express Bank, Canara Bank,
Centurion Bank of Punjab, The Lakshmi Vilas Bank Ltd. and Punjab &
Sind Bank, 20 Co-operative Banks in Gujarat, Rajasthan, Jammu &
Kashmir, Bihar, West Bengal, Andhra Pradesh and Maharashtra and two
regional Banks.
Performance
To fuel future
growth Aviva announced an increase in its capital base by US$ 46.3
million in Janury 2007, taking the total paid-up capital to US$ 176.6
million. Aviva has a long-term commitment to India and the current
capital infusion of US$ 46.3 million will allow it to expand operations
and launch new products.
Aviva’s Fund management operation is
one of its key differentiators. Operating from Mumbai, Aviva has an
experienced team of fund managers and the range of fund options include
Unitised With-Profits Fund and four Unit Linked funds: Secure Fund,
Balanced Fund, Growth Fund and Protector Fund. The flagship fund of the
Company, Balanced Fund, has performed very well with a Compounded
Annualised Growth Rate (CAGR) of 27.05 per cent (December 2006) since
inception (June 2002). The Growth Fund has recorded a CAGR of 39.35 per
cent (December 2006) since inception (January 2004). The company
recorded healthy growth in both Direct Sales Force and Bancassurance
channels.
Aviva’s annual premium accretions have grown by close
to 83 per cent. Till February 2007, its new premium’s accretion
amounted to US$ 139.8 million, up from US$ 76.4 million last year. Close
to 90 per cent of this growth was from unit-linked insurance plans
(ULIP). After the addition of US$ 46.3 million in January 2007, Aviva’s
capital has increased to US$ 176.6 million. Capital infusions have been
planned up to 2010.
| 2. BARCLAYS |
operates in over 60 countries with more than 100,000 permanent
employees.
As a global leader in risk management, Barclays
offers Indian clients access to a comprehensive suite of risk management
solutions across asset classes. Barclays has had a banking presence in
India for over 27 years. It has made two capital infusions since 2002
strengthening its capital base by US$100 million and so bolstering its
India Rupee debt capital markets platform and extending risk management
capabilities. In 2004, Barclays made a financial investment in UTI Bank,
demonstrating its commitment to the fast growing financial sector in
India.
3.BP
is BP’s main business activity in India, the company also operates
India’s most successful solar power company as a joint venture with the
Tata group.
BP entered India through a joint venture with Tata
Power to form Tata BP Solar. The company entered the lubricant business
in India by taking over Burmah Castrol in 2000, with a 71 per cent
shareholding.
Subsequently, Tata BP Lubricants India Limited
was amalgamated with Castrol India Ltd. BP now holds 71.3 per cent of
the paid up capital of the company.
Castrol India has the second largest share of the Indian lubricant market. Castrol leads in the automotive lubes segment.
3. BT
India. It established its international customer relationship office in
1995. BT has two outsourced call centres in Noida and Bangalore, with
over 1400 agents and the number is growing. The company has launched its
first managed international private line service too.
Gauging
the need of the Indian market, BT set itself on a vibrant path of
infrastructure building. The organisation works closely with local
partners and has deployed some of the largest managed services networks
in India. Presently, BT caters to 200 customers, of which 100 are
managed services customers.
BT has partnered with VSNL and
Bharti to provide leased circuits and traditional voice services.
Managed data services are offered in association with Bharti. BT started
its India Customer Management Centre in Pune.
British Telecom
has a taken up the initiative of sponsoring a school in Delhi, which
provides IT training for unprivileged children.
The company currently has over 200 employees, with service coverage
across bangalore,Mumbai, Chennai, New Delhi, Pune and Hyderabad. It
manages over 150 global customers from the India Centre of Excellence
located in Bangalore. Cable & Wireless was the first international
carrier in India to receive the BS7799 certification, assuring its
customers of stringent security practices.
Cable & Wireless
in India offers global connectivity solutions over multiple
technologies including MPLS & ATM, network design and integration,
remote network management solutions, contact centre design, integration
and management solutions and other network related professional
services. C&W has been the first carrier in India to obtain a Cisco
gold certification. Its customer list includes companies in banking and
finance, BPO, software, manufacturing and petrochemicals.
Cable
& Wireless India has been performing well for the past few years.
For the year 2004-05, it has delivered a robust financial performance.
It increased its revenues, from domestic market, from around US$ 19
million in 2002-03 to around US$ 47 million in 2004-05.
Cadbury India is a wholly owned subsidiary of Cadbury
Schweppes which has operated in the country for more than 55 years. It
was originally incorporated as a wholly owned subsidiary of Cadbury
Schweppes Overseas Ltd in 1948. The company today employs nearly 2,000
people across India. Cadbury India is the No. 1 confectionery company
with a 70 per cent market share in India.
Cadbury India has
spent time in understanding the Indian consumers. Leveraging its 55
years of experience in India, the company has customised its products to
the Indian markets.
The company plans to increase the
franchise of its existing brands and continue to explore new product
opportunities including adjacent market opportunities.
6. CAIRN ENERGY
Cairn Energy developed the Ravva oil and gas field in the
Krishna-Godavari Basin in Eastern India during the 1990s. Producing
interests in Ravva and Sangu have provided Cairn with strong cash flow
and a competitive edge in its subsequent exploration activities across
India.
Cairn Energy is looking for more exploration
opportunities in India. More than 77 wells have now been drilled by
Cairn in Rajasthan. The company plans to have 20 to 30 more wells
drilled in Rajasthan by the end of 2005.
7. GSK PHARMACEUTICAL
GSK has had a presence in India since 1924, and is a leading
pharmaceutical company in the country today, employing more than 4,000
people. GSK started its operations in India in 1924, GSK India is
organised into three business segments: Pharmaceuticals the predominant
business, Agrivet Farm Care (AFC) and Qualigens Fine Chemicals (QFC).
The company is strong in vaccines and enjoys a leadership position in
the therapeutic segments of Dermatology, Corticosteroids,
Analgesics/anti-pyretics and Thyroid preparation segments. The company
has two manufacturing units located at Thane and Nashik.
It
intends to use the skills of the workforce available in India for
clinical research in a significant manner. GSK is planning to launch its
innovative products in the product patent era as it believes that India
is willing to protect the Intellectual Property Rights of GSK and other
such companies.
8.HSBC
The profits of HSBC India have shown a broadly increasing
trend. At 14.5 per cent (as on March 31, 2004), the capital adequacy
ratio of HSBC was one of the highest in the Indian Banking Industry.
Anticipating a retail banking boom in India the bank acquired the
Non-Fund activities from Gujarat Lease Financing Ltd. in 1999. In the
year 2000, the bank acquired the Chandigarh branch licence from Deutsche
Bank. In 2002, HSBC acquired retail banking business from BNP Paribas
and the Retail Banking Operations in Kolkata from Bank of
Tokyo-Mitsubishi. Currently HSBC has 37 branches across 18 cities.
HSBC plans to expand its capital market, corporate and investment
banking teams in India. The bank intends to set up a global analytical
support team to help the group in its research in investment banking
globally.
9. MARCONI TELECOM
Marconi has had a presence in India since the early 1990s and
direct presence with an ISO 9001 certified manufacturing unit since
2001. The company established a subsidiary company in India as it saw a
potential in the emerging telecommunications market, driven by telecom
sector reforms and the growth of private players as well as public
sector entities such as BSNL and MTNL. It sought to leverage the
opportunity to meet the growing equipment needs of these players.
Marconi acknowledges the availability of India’s strong talent pool. It
leverages this by outsourcing its development work to leading Indian
companies, as well as universities.
Marconi sees India as a good potential market, and expects it to grow steadily over the next 5-10 years.
10. UNILEVER
HLL has developed some of the best brands in the country in
the FMCG sector over the years. With an experience of several decades in
India and an unmatched distribution network directly covering over a
million retailers and price-competitive products, it has emerged as the
market leader in the sector.
HLL’s Hindustan Lever Research
Centre (HLRC) is involved in developing new products and processes,
improving the benefits and quality of existing products, finding ways
for optimal use of resources, energy conservation and pollution control.
HLL has over 184 patents.
HLL is planning to enhance its distribution and product communication strategy.
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